Jerry received a check from McGregory Corporation as a dividend on his preferred shares. Two days later, one of the corporate directors called him and said he would have to return the check since it was erroneously declared and the company would not be able to pay its day-to-day expenses. Jerry would:
A) have to return the check because the company would be insolvent.
B) have to return the check since it was erroneously declared.
C) not have to return the check because Jerry acted innocently.
D) not have to return the check because the board acted in good faith.

Question

Quizplus · Accepted Answer

The Answer of Jerry received a check from McGregory Corporation as a dividend on his preferred shares. Two days later, one of the corporate directors called him and said he would have to return the check since it was erroneously declared and the company would not be able to pay its day-to-day expenses. Jerry would:
A) have to return the check because the company would be insolvent.
B) have to return the check since it was erroneously declared.
C) not have to return the check because Jerry acted innocently.
D) not have to return the check because the board acted in good faith.

Jerry Received a Check from McGregory Corporation as a Dividend